Healthcare to Improve Using Public Funds

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Written by PolicyBazaar

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Published : 23 June 2014

Indians around the world are hoping that the newly elected Prime Minister Narendra Modi besides everything else would also work for the betterment of health-care services. There are six practical steps that he could implement as Prime Minister to quickly ensure improved health for all Indians.

Tax-Payer Financed Services:

The government could decide a limit before which most private spending can be substituted by taxpayer-financed health services. Is India financially capable to do this? Yes. India already spends about 6 per cent of its GDP on health care. But 80 per cent of this is out-of-pocket and drives more than 40 million Indians below the poverty line every year. Besides this, the quality of health care also differs. Ask any urban resident of his/her experience in a private hospital and you will hear how he/ she paid huge sums of money only to get below satisfactory treatment or overtreatment, of dubious quality and with little respect. UHI (United Health Insurance) should not be about insurance for the well-off, but instead, lessen large expenses for the poor.

One of the main tasks is to increase revenue: VAT and other tax reforms can raise about 3 per cent of GDP, at least half of which should be contributed towards the first phase of providing UHI. The second challenge is to keep a tab on any downward growth in private indemnity insurance. UHI will waive the current out-of-pocket spending and direct funds toward far more productive uses. A single-payer system is an example of strengthening the reach of health care through a wide range of private providers. It is also a fine way to check unfair practices in the health-care system. Gujarat’s Chiranjeevi Yojana is one example of how private services can be delivered using public finance.

While improving the public health-care system, the government could simultaneously adopt a few bold, highly result-driven interventions within three years to improve health care. In India, around 1.5 million children continue to die before their fifth birthday, mostly due to conditions that are treatable. Thus, a second priority should be to include a fast scale-up of the initiation of new vaccines against diarrhoea and pneumonia among children. These vaccines have made ear infections among children in the west less common. If they are used in India, perhaps the deaths of 2,00,000 children (between the ages of 1-59 months) can be checked. While these new vaccines are a lot more expensive than they were in the past, they are certainly cost-effective. Innovative delivery models, such as the one that the Union Health Minister Dr. Harsh Vardhan pioneered in Delhi for polio, must be verified and scaled to deliver vaccines to every doorstep.

The most feasible preference will be to ban smoking. Smoking kills about 1 million Indians every year. The number of cases of tuberculosis has risen because of smoking. While all kinds of smoking are fatal, chronic cigarette smoking has already been shown to deprive Indians of a full decade of life on an average. All cigarettes must be taxed on their tobacco content and not length.

Preventing Vascular Deaths

A fourth priority should be to limit adult vascular deaths - the major cause of deaths in the country, killing over 1 million Indians between the ages of 30 and 69 per year. Data shows that about two-thirds of people who die from such diseases suffered a heart attack or stroke earlier. In such patients, low priced generic risk pills that combine aspirin with a statin drug in order to reduce cholesterol and lower blood pressure can bring down the chances of suffering another stroke or even dying by two-thirds. Low-cost treatments of acute heart attacks are also now possible. The vibrant Indian generic drug industry knows how to deliver high-quality drugs at low cost (and indeed was largely responsible for the major turnaround in HIV treatment in Africa).

Controlling Malaria

A fifth priority should be to counter malaria. India has made significant progress in decreasing the number of cases of malaria and the number of deaths caused by the disease (although the official numbers of rural Indians dying from malaria remain underestimated). Careful measures need to be taken to prevent a big resurgence of malaria.

This would involve a change in the Indian malaria programme to proper use of combination drugs. These treatments must have a wide reach in rural areas, particularly in Odisha and the northeast. India can earmark $100 million to a regional malaria fund, and establish a public-private partnership to offer subsidies to reputable drug manufacturers (many of whom are in India). Acing malaria control in Asia will improve India’s health profile in the region.

Finally, a major effort should be made to better health reporting. The Census should be strengthened, expanded and clubbed with the economic census and other surveys. This new central information hub will help track and report on development and progress.

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